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30 May 2008

Hard Wired(HKTDC Enterprise, Vol 06,2008)

Staying with a winning line makes a lot of sense, which is why Welford Industries Ltd has continued to manufacture candleholders for the past 25 years or more. Recent additions to the firm's activities include candle stands, fruit baskets and flower racks, all featuring sheet metal and steel wire.

While the firm's Hong Kong office was established in 2000, Welford Industries' Pearl River Delta factory has been running since 1990. "In 2003, the plant was among the top firms recognised for products of excellence in the Heshan Top 10 and Jiangmen City Top 30 Private Enterprise awards," says Executive Director Patrick Leung.

Strong demand

Noting that candleholders were the firm's start-up line, Mr Leung says that demand continues strong. "There are so many variations that we can always come up with a new design, either as a one-off or as part of a series," he says.

Alongside candleholders are wire baskets suitable for apples, oranges and bananas, which are attractive enough to sit on tabletops or sideboards. "Many of our products are manufactured using powder-coated steel wire, and we usually stick to smart, dark colours as they are more readily acceptable as both indoor and outdoor decorative items," Mr Leung says.

"While our products are wholly intended for household use, we extend the range to both indoors and outdoors," he adds. "For example, our fruit baskets can also be used as very attractive flower pot holders."

Flexible approach

Other multipurpose items include a fireplace screen, a garden trellis and a special votive holder for use on an outdoor patio table with umbrella.

"For outdoor items we use a non-rust coating, as well as thicker and higher density finishes to ensure the end product is rust-resistant. We focus on black and chocolate brown finishes, while we are often asked to provide goods with an antique look," he adds.

Welford Industries cannot solely rely on clients providing designs, and offers both OEM and ODM solutions. "We do quite a lot of OEM work and these orders keep the factory running throughout the year," says Mr Leung, indicating that one OEM item is a wall sconce for which the firm has received a first order of 25,000 pieces.

Other OEM goods are decorative items such as Aztec-type solar circles, a lifelike gecko and a bull design that sells in Spain for the tourist trade. There is also a coffee-cup holder with a smart electroplated finish. "These products bring us quite decent returns," says Mr Leung. "However, not all products sold are that profitable because some tough customers always push for really low prices."

The company employs its own local designers, and occasionally some from further afield. "A Filipino designer contacted us and, while we could not offer full-time employment, we came to an agreement for contract work," says Mr Leung. "This has worked out very well."

In the future, Welford Industries intends to focus more on ODM products. "We are considering hiring another designer to facilitate this as each designer brings new ideas and a different approach," says Mr Leung. "We want to differentiate ourselves, but our product range will remain very similar to today's because the candleholder is an integral part of our business."

New clients

Welford Industries' customer base is changing. "In the past, more than 90% of orders flowed through trading companies," recalls Mr Leung. "Today, that figure is closer to 60%. The trend is definitely toward more direct dealings and less through traders."

The market is very competitive, sharpened by the fact that the cost of everything needed for manufacturing continues to rise. "The Chinese yuan is very strong against the US dollar, and this is becoming worrisome," Mr Leung laments. "It means that we are forced to increase prices to levels that customers say they cannot accept as they cannot suddenly increase retail prices."

The main difficulty, he stresses, is in quoting a firm price. "If we quote in April, say, based on the current exchange rates, we could see a loss if we ship and get paid in, say, the following September."

Putting aside all of these concerns, Mr Leung stresses that Welford Industries is in business for the long haul. "We love to hear from clients, old and new, and to discuss our existing range or ideas for new products. At Welford Industries the door is always open."

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